UK sales of contract mobile phones running the Android operating system rose by 350 percent in the second quarter, according to market research firm GfK Retail and Technology.

The figures in Monday's GfK report also show that the open-source operating system's share of the market for contract smartphones jumped 10.2 percentage points, from 3 percent to 13.2 percent, in the three months to June.

GfK noted that the increase in Android handsets is "staggering", given that sales of contract smartphones in general increased just 1 percent.

"The figures suggest an increasing number of consumers are now asking for Android handsets by name," GfK analyst Megan Baldock said in a statement. "Operating systems are no longer simply a by-product but a key selling point in their own right."

Popular handsets such as the HTC Desire, Sony Ericsson Xperia X10 and Samsung Galaxy S all launched in the UK in the first part of 2010, contributing to the overall number of sales.

In addition, GfK said its research shows that the number of customers opting for smartphones over traditional 'text and talk' handsets is increasing, rising from 55 percent of contract sales in the first quarter to 67 percent in the second.

This growth in popularity is reflected in a research report released on Thursday by Strategy Analytics, which show a 43 percent year-on-year increase in the number of smartphones sold worldwide during the second quarter, taking the total to 60 million.

However some manufacturers, such as Nokia, are struggling at the high end of the mobile market, according to the market research firm.

"The global smartphone industry is beginning to feel the effects of intensifying competition. Dozens of vendors from the telecoms, PC and consumer electronics industries are piling into the market and driving down prices. Even established brands such as Nokia, RIM and Apple are finding it increasingly hard to raise prices and profits in the face of such crowded competition," Strategy Analytics said in a statement.

Despite recently reporting its highest quarterly earnings, Apple is showing signs of slipping, with its smartphone market share dropping from 15.9 percent to 14.1 percent between the first and second quarters, according to the report.

"We believe Apple may have lost some heartshare in recent weeks because of its perceived mishandling of the antenna problem, and Apple will have to work hard during the second half of the year to stop lost heartshare converting into lost marketshare," said the Strategy Analytics statement.

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